US home prices far outpace Americans' paychecks. See how bad the problem is where you live

foxbusiness.com:

'Mansion Global' host Katrina Campins discusses the state of the housing market on 'Making Money.'

Homeownership has slipped out of reach for millions of Americans due to high mortgage rates and home prices, and the affordability crisis continues to deepen.

Since the start of 2020, home prices have surged more than 47% – the fastest pace of growth since the financial crisis more than a decade ago. 

Before the COVID-19 pandemic began, a house typically cost about three times a buyer's annual income. But that ratio has risen sharply over the past few years, according to a new report published by the Joint Center for Housing Studies at Harvard University. 

Median home sales prices last year were about five times the median household income, pushing «homeownership farther out of reach for millions of potential buyers in 2024,» the report said.

US HOME PRICES JUST SMASHED ANOTHER RECORD HIGH AS AFFORDABILITY CRISIS DEEPENS

Now, in order to buy a home in nearly half of U.S. metro areas, buyers must earn more than $100,000 annually to afford a median-priced house. That marks a notable increase from 2021, when that was the case in just 11% of markets.

There are a number of driving forces behind the affordability crisis. 

MORTGAGE CALCULATOR: SEE HOW MUCH HIGHER RATES COULD COST YOU

Years of underbuilding fueled a shortage of homes in the country, a problem that was later exacerbated by the rapid rise in mortgage rates and expensive construction materials.

Higher mortgage rates over the past three years have also created a «golden handcuff» effect in the housing market. Sellers who locked in a record-low mortgage rate of 3% or less during the pandemic began have been reluctant to sell, limiting supply further and leaving few